The sales contract or Promise of Purchase Agreement
Once you agree upon the price then make the sales contract. In Colombia verbal and written agreement have the same enforcement, but in real estate businesses is always better to make a written agreement to assure buyer's rights.
This is a “Promise Purchase Agreement”, where both parties can defined the terms of the negotiation and it will serve as a model for the final deed.
It has to include at least :
- Buyer's and Seller's I.D numbers
- Title Recording
- Time and way of payment. Down payment is usually about 20% to 30% of the price agreed.
- Property’s boundaries
- A penalty clause in case of either the Buyer or the Seller breaks the deal (about 50% to 100% of the down payment).
- Commision plan if a real estate agent is used
To Sign a purchase agreement gives the Seller time to bring the property up to the agreed condition, and to pay past due taxes, utility bills, or move out if that's the case.
The Buyer uses this time to arrange for funds, prepare a trip, or name someone else to act as his representative to complete the sale.
The buyer can sign either directly or through a third party representative. In the later case, the buyer must provide a special power of attorney to his or her notary, who must have a proof of certifiable Colombian identification to sign the contract on the buyer's behalf.
The power of attorney needs to be signed by the buyer before a public notary unless made abroad in which case you have to go to the nearest Colombian Consulate in your home country to legalize the document and your signature.
A power of attorney that is signed abroad is considered valid if legalized by the Colombian Consulate.
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